At Union Hand-Roasted Coffee our mission is to hunt for fantastic coffees. We do this through Union Direct Trade, which means that we work directly with farmer and producer organizations, often through co-operatives of coffee farmers who work together to share facilities, achieve better trading terms and obtain access to vital credit facilities. For example, in Costa Rica, the establishment of micromills and taking responsibility for processing to improve quality, means that producers are directly in control of their coffee which gives them access to markets without relying on Coyotes (middlemen) to buy their coffee. Pascale visited the Puente Tarrazú micromill in the Los Santos region of Costa Rica which is famous for its excellent cup quality – something that they’ve worked very hard to protect.

Visiting our producers in Costa Rica

In Costa Rica producers always used to sell the red cherries to intermediaries or large buyers such as Volcafe. Producers had to accept the price they were offered and had no power to influence this because they had no other market access. They were frustrated that the extra work to produce their correctly picked, high altitude coffee was mixed with lower quality coffee also purchased by some of those companies. With the beneficio humedo, or micro mill revolution, this has changed.

A micro mill can be described as a small factory where coffee cherries are processed into parchment coffee. The micro mill allows producers to process separate micro lots. In doing this, they can

achieve higher quality, consistently

add value to their coffee

negotiate better prices.

Now coffee from Puente Tarrazú does not end up at the bulk market mixed with low quality annonymous coffee, but is sold to roasters retaining the identity of the finca.

This is the stunning view from the terraces of the San Jeronimo Micro Mill, about an hour from Buenos Aires in the Perez Zeledon region near the Chirripo volcano where Pascale visited in July and September.

These producers cultivate Bourbon, Caturra, Catuai, and Tipica. The collection of the fruits takes place between August and December and the coffee is fully washed during processing.

Seven associates funded and constructed the mill, but each year another 30-50 producers used to deliver their coffee to the mill for processing. This volume led to problems – some producers received a credit for the complete harvest then delivered only a minor part of their production to the mill, or refused to comply with the mill’s strict quality restrictions.

Last year the management of the mill decided that they want long-term and trusted relationships with the producers that bring coffee to them and so interviewed all the producers and vastly reduced the number to a more manageable number of about 20 producers.

Why are micromills good for coffee growers?

As well as ensuring the quality of the coffee, it’s very important for the micromill cooperatives to protect the growers and their incomes as the coffee market has been volatile in the past two decades. Union Hand Roasted Coffee enters into long-term agreements with a floor price guarantee and in many cases, pre-financing arranged with micro-credit agencies which we underwrite. Cashflow is crucial to ensure that the producers can live during the season, plan ahead for buying fertilizer, and afford to pay labour costs during the picking season. We want to protect the producers’s livelihoods as well as our access to their coffee. Pascale found out why this is so important from the Puente Tarrazú producers:

As they explain, around the millennium, many producers abandoned their coffee farm, as prices fell to ₡25.000/$50,- colones per faneja. Coffee became a non-profit making business, as prices did not even cover production costs. It was almost impossible to invest in coffee since no banks were willing to finance coffee related projects.

The crisis affected the region, some people lost their houses or their land and the vast majority took less care of their farms. Some neighbours decided to partially or completely retreat from coffee, but this group decided to fight for better coffee prices and set up a micromill to cultivate and process Caturra, Bourbon and Tipica.

Working with producer associations helps us to secure the best coffee, and gives them the best prices as well as long term security. We also get to work with producers who are passionate about coffee, and discover new experimental coffees (which we often offer as special microlots) that are a privilege to sample.

Coffee co-operatives in Guatemala

This picture is taken in the bodega (warehouse) of Esquipulpas Cooperative in La Libertad, Huehuetenango, Northern Guatemala – the issues around financing and cashflow are very similar in all the countries where we work. The picture shows the sacks of parchment coffee that the individual farmers have delivered to the bodega.

Before Union started working with them, the cooperative did not receive pre-finance for their coffee so they could not provide any money before the harvest for their members. Instead they took out loans which allowed them to pay a part of the coffee price to producers at the moment they deliver. But the interest rate from local bank was very high, and the loans are against property – which are not worth very much, so the value of the load was small.

Now with the relationship with Union, we’ve introduced specialist agencies like Root Capital to prefinance everything they require at low interest rate. The cooperative now has funds to purchase larger volumes of fertilizer at a more competitive rate. And farmers have money to pay pickers at the begining of the season.

The cooperative also guarantees the producers a minimum price (this year, it was Q1250 per quintale), regardless of the price the coffee achieved when it is sold. When the coffee is delivered to the cooperative, the producers receive 80% of the year’s minimum floor price, and then receive a second payment when the coffee is ready for export. We know this is working working well for producers becasue the cooperative has seen a 20% increase in membership applications this year.

One of the most important aspects of coffee cultivation, in addition to being vigiliant about disease, is ensuring correct inputs for nutrition takes place. Pascale saw some of the different methods in use on the farms in Guatemala when she looked at coffee planting.

How coffee gets good nutrition?

Coffee trees need to receive essentional nutrients. In Guatemala producers usually clear the area surrounding the coffee plant first, and then throw three neat handfuls of compost fertilizer and NPK (Nitrogen, Phosphorous & Potassium) around the base. Coffee plants are fertilized up to three times a year. The frequency mainly depends on the cash that producers have available to buy the products. Fertilizing is one of the most expensive activities for these producers.

In La Libertad and Todos Santos in Guatemala, coffee is grown in shade of other crops. The leaves that fall off the canopy trees also serve as an organic material to enrich the soil. Organic material is important because of the nutritients and mineral material that it returns to the earth.

If you understand Spanish then you can probably guess what is inside this structure, hidden away under a canopy from the sign on the top.

It is full of worms! Some producers in Todos Santos produce their own organic fertilizer. It is a cheap and convenient way of producing organic material. The biggest risk is not covering the infrastructure and giving the birds a nice dinner!

One of the frequently used components of this compost fertilizer is discarded cherry skins, which are removed during post-harvest processing of the beans.

Coffee plants, if properly tended, can continue to produce viable coffee cherries for up to thirty years. However, given that they can also take between three and four seasons to start producing fruits, it’s a case of investing now for reward later when starting out. An outbreak of disease can be devastating for producers, especially if the more mature trees which produce the bulk of the crop, are affected.

Commonly found diseases in coffee

Pascale found out more about some of the most common diseases that can affect coffee in Guatemala when she visited farms with ANACAFE.

Ojo De Gallo

Coffee is susceptible to disease such as Ojo de Gallo or Rooster’s Eye. In Huica, where we visited some parcels which are old in coffee terms (30-40 years) and therefore even more susceptible. We found many cases of Ojo de Gallo. This is a fungus, Mycena citricolor, that can severely harm the plant, but develops slowly. First, the leaves develop a marking pattern called “rooster eyes”, then the leaves will fall off and beans will be affected too and finally the cherries will rot on the tree. Severe crop loss may occur and less coffee means less income.

Ojo de Gallo can be prevented by proper management, since too much moisture & humidity promotes the development of the fungus. High rainfall and too high shade density preventing good air circulation are all contributing factors. Good fertilization and composting to ensure healthy plants also helps with prevention. If coffee parcels are old, the plants can also be removed or pruned to prevent further spread of the disease. Chemical anti fingus applications also can eliminate Ojo de Gallo, but prevention is preferred.

Mancha del Sol

Cultivating coffee is not easy. Although Ojo de Gallo is prevented by providing enough shade, too little can result in Mancha del Sol. They are also easily confused, although Mancha del Sol is characterized by the yellow circle around the black spot. Fortunately, producers in Guatemala do not have to combat diseases such as Roya de café (Hemileia Vastrix) which is one of the biggest problems in cultivating coffee in countries like Colombia – an outbreak can destroy up to 70% of a parcel.

We visited a group of producers in San Miguel Ixcahuacan and went with them to another co-operative at La Libertad. They visited parcels and then also worked with the cuppers from Esquipulas. These type of interactions are important, as producers are more likely to adapt cultivation practices recommended by visiting agronomists when they can see with their own eyes that these practices improve the conditions of the parcels. If you hear you will forget, if you see you will remember…

Producers share knowledge with the help of organisations such as ANACAFE and we at Union also run seminars and workshops for them. We believe it’s really important and we’ll be discussing the role of the co-operative in more detail next time!

We’ve talked about what a coffee bean is – so now we take a look at whats happening in the field? We may undertake around twelve ‘origin’ trips a year on average, to visit the farmer partners and producers we source our coffee from and to learn more about changes during the season on the farms. Pascale, a development economist reseacher who’s been working with us, has also been visiting producers’ co-operatives in Guatemala. She had the opportunity to observe more about planting coffee and also what other crops are important to the farmers to diversify their income.

How is coffee grown?

Young coffee plants are grown in nurseries, shown here which is in Guatemala.

Here coffee producers grow new young coffee plants in a special format so they can be transplanted into the land parcels within the first year. The plants are either grown in plastic plant pot-bags as in the picture or directly into the ground. The plants are placed neatly in rows because one needs to have room around the plants to fertilize and to weed the surrounding area (to avoid disease transmission).

Why is crop diversity important?

The farmers often grow other crops too, for a variety of reasons; to give shade to coffee plants, to provide for their own food needs, and to have other sources of cash crops to contribute to their income outside of the coffee season. Here’s a great project in Huica that Pascale visited:

The women of Huica have a mushroom project, which not only provides an alternative income source but also diversifies their diet. They grow the mushrooms in an old barn that has the correct moisture and light levels.

There are different ways to cultivate mushrooms. These women use maize stalks as the growth medium, which are abundant because tortillas which are made of maize dough feature in every meal here. Mushroom growing does not require a great investment, only the seeds and plastic bags need to be bought every time.

After approximately 45 – 60 days the mushrooms are ready to harvest. The crop can be susceptible to disease, but if taken care of properly a substantial harvest can be managed in relatively little space. The harvest takes place every two months and the sales at local markets and to friends and neighbours provides regular cash flow. During the coffee season, women often stop mushroom cultivation, as coffee requires all of their time. And they need to use the barn to dry and store their parchment coffee.

Coffee ready to be picked:

Still green and immature coffee beans are shown here together with new coffee flowers not yet opened. The flowering of the coffee plant is dependent on several factors, most importantly rainfall.

With the first rains during the wet season the coffee plant starts to flower with coffee blossom. This is not only a magnificent sight, like these plants in Tuiboch, Todos Santos, but also brings with it a delicious aroma of jasmine.

One can often find banana or plantain trees in the coffee fields, planting both cash and food crops in the same area is an optimal way of using space.

Next time I want to discuss some of the problems and issues that can affect coffee plants during the growing season – and how farmers overcome them.

If you’ve followed our series of posts about developing our ethical Union Direct Trade for coffee sourcing you’ll know that Pascale spent 6 months of last year in Central America working with the small scale farmers who produce the coffees we buy. Pascale has a Masters in Development Economics from Wageningen University (The Netherlands). She has returned to Guatemala at the start of the season to continue her work with us at Union on improving standards. With much talk about “Direct Trade” we consider this mechanism has to be more than just coffee provenance and likewise any claims made about profitability have to be verified. Here Pascale explains that most producers don’t have a clue what their production costs are and how we’re tackling this problem. (Steven)

Location: Tuiboch, Todos Santos Guatemala

Activity: Workshop about costs of production & labour standards

Participants: 22 producers.

Date: 6 February 2012

Monday the 6th of February I visited Tuiboch, Todos Santos. I gave two workshops, those who have followed my earlier blog know that I have spent some time with these producers in March/April 2011 conducting a study on their costs of production. This study helped the cooperative to define a fair price per quintal in pergamino (parchment coffee) which is set at 1250 Quetzales, for this year. One of the most important conclusions of this study was that none of the producers keeps a proper administration of their costs. This is very typical for small scale farmers. So my return to Guatemala was an excellent opportunity to present the results of the study and discuss my findings with the producers. I showed them how they can keep track of production costs and showed them a small booklet I have created for them in a format that will facilitate them to keep track of their costs of production! This way they can account for all their costs and ensure they sell their coffee at a price that allows them to reinvest in their farms.

My second workshop was related to a small-holder booklet developed by the Ethical Trading initiative (ETI), a British organization which aims to raise workplace labour standards among suppliers to into the British market. The standards ETI follows are based on those of the International Labour Organization (ILO). A Spanish version of the booklet has been created but Union Hand-Roasted Coffee have taken a more pro-active approach and discuss these working conditions with coffee producers. Therefore, we are going to the different communities in Guatemala and presenting the Labour Standards workshop and discussing them with the producers. Treating subjects as equal payments, fair payments and clean and secure working conditions are very important. To illustrate, during the workshop none of the producers were aware of the minimum wage in Guatemala. This is important if they hire pickers to help with the harvest on their farms.

After the workshop we cupped 9 coffees together along with the producers. The interaction was beneficial because producers could experience by tasting and learning for themselves for example, if coffee needed a couple more hours of drying in the sun. Also showing them the broken beans in the coffee helps them to understand the importance of calibrating their depulper machine with the correct sensitivity. We are going to repeat this exercise with the other communities that produce the coffee we have named “Guatemala Liberacion”, so I will keep you up to date.

It was a very successful day with the help of Cooperativa Esquipulas R.L. and the participation of the producers. See the photos for yourself!